You are here: / / Fraud Action Based Upon Statements of Opinion Properly Pled/Negligent Misrepresentation...
, ,

Fraud Action Based Upon Statements of Opinion Properly Pled/Negligent Misrepresentation Not Properly Pled–No Allegation of Privity or Privity-Like Relationship

In an action stemming from defendant-investment-ratings-agency’s high rating of worthless residential-mortgage-backed securities, the Fourth Department determined the complaint properly pled a fraud cause of action, even though based upon statements of opinion. The court further determined the negligent misrepresentation cause of action was deficient in that privity or a privity-like relationship was not alleged:

Although statements of opinion generally are not actionable in a fraud cause of action …, defendant correctly recognizes that statements of opinion may nevertheless be actionable as fraud if the plaintiff can plead and prove that the holder of the opinion did not subjectively believe the opinion at the time it was made and made the statement with the intent to deceive … . As one court has explained, a fraud claim based on an expression of opinion “is actionable in an appropriate case not because the opinion is objectively’ wrong. Rather, in an appropriate case it is actionable because the speaker either did not in fact hold the opinion stated or because the speaker subjectively was aware that there was no reasonable basis for it . . . In the first instance, the speaker will have lied as to his or her subjective mental state. In the second, he or she implicitly would have represented that there was a reasonable basis for the statement of opinion, knowing that the implicit representation was false” … . Here, we agree with defendant that its credit ratings were statements of opinion, not fact … , but we conclude that plaintiff adequately pleaded that defendant did not believe its opinions when it issued the ratings. Plaintiff set forth in detail the reasons why defendant was aware that the ratings were inflated, including its allegation that defendant failed to follow its own policies and procedures in determining the ratings. * * *

To establish a claim for negligent misrepresentation based on the allegedly inaccurate credit ratings, plaintiff must allege that “(1) the [defendant] must have been aware that the [ratings] were to be used for a particular purpose or purposes; (2) in the furtherance of which a known party . . . was intended to rely; and (3) there must have been some conduct on the part of the [defendant] linking [it] to that party . . . , which evinces the [defendant’s] understanding of that party[‘s] . . . reliance” … . “The indicia, while distinct, are interrelated and collectively require a third party claiming harm to demonstrate a relationship or bond with the once-removed [defendant] sufficiently approaching privity’ based on some conduct on the part of the [defendant]’ ” … .

The complaints here failed to plead that a special or privity-like relationship existed between plaintiff and defendant … . M&T Bank Corp. v McGraw-Hill Cos., Inc., 2015 NY Slip Op 02372, 4th Dept 3-20-15

 

You might also like
DEFENDANT PROPERTY OWNER WAS THE ALTER EGO OF PLAINTIFF’S EMPLOYER, PLAINTIFF’S ONLY REMEDY FOR INJURY FROM A FALL WAS UNDER THE WORKERS’ COMPENSATION LAW (FOURTH DEPT).
DEFENDANTS DID NOT DEMONSTRATE THRESHOLD STRIP WHICH ALLEGEDLY CAUSE PLAINTIFF TO SLIP AND FALL WAS NOT INHERENTLY DANGEROUS AND TRIVIAL AS A MATTER OF LAW, DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN GRANTED (FOURTH DEPT).
DEFENDANT’S MOTION TO VACATE HIS CONVICTION BY GUILTY PLEA SHOULD NOT HAVE BEEN DENIED WITHOUT A HEARING, DEFENDANT SUFFICIENTLY ALLEGED HIS COUNSEL PROVIDED WRONG INFORMATION ABOUT THE POSSIBILITY OF DEPORTATION.
CREDIBILITY ISSUES ARE FOR THE JURY, PLAINTIFF’S VERDICT SHOULD NOT HAVE BEEN SET ASIDE BASED UPON THE JUDGE’S FINDING DEFENDANT DOCTOR’S TESTIMONY CREDIBLE IN THIS MEDICAL MALPRACTICE, WRONGFUL DEATH CASE (FOURTH DEPT).
ALTHOUGH THE PEOPLE STATED THERE WERE NO IDENTIFICATION PROCEDURES REQUIRING NOTICE TO THE DEFENDANT, THE EVIDENCE INDICATES THERE MAY HAVE BEEN IDENTIFICATION PROCEDURES AT THE POLICE STATION BY A POLICE OFFICER, CASE SENT BACK FOR A HEARING (FOURTH DEPT).
Defendant Could Not Deny Ownership Of Vehicle (Which Was Allegedly Transferred to Another Prior to the Accident) Because License Plates Had Not Been Removed
THE ONE COUNT INDICTMENT WAS RENDERED DUPLICITOUS BY THE BILL OF PARTICULARS AND WAS DISMISSED AFTER TRIAL; THE APPELLATE COURT NOTED THAT EVEN IF THE EVIDENCE HAD BEEN NARROWED AT TRIAL, DISMISSAL WOULD STILL BE REQUIRED BECAUSE DEFENDANT DID NOT HAVE PRETRIAL NOTICE OF THE CHARGES (FOURTH DEPT).
Termination of Parental Rights Affirmed Because Diligent Efforts to Reunite Parent and Child Were Made (In Spite of Misdiagnosis of Mother’s and Child’s Psychological Conditions)

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy

Municipalities (Counties) Are Not “Persons” and Therefore Cannot... Cheerleader Assumed the Risk of Practicing with an Injured Teammate